News & Events

Funds Partner Jason Herman was quoted in an article from Private Equity Law Report titled, “Four Common Fund Structures to Mitigate ECI Risks When a PE Sponsor Launches a Private Credit Strategy (Part Two of Two).” The article discussed tax considerations for non‑U.S. or tax-sensitive investors in private credit funds, and the benefits and challenges of common private credit fund structures that can be used to mitigate such tax impacts. When discussing onshore/offshore “season and sell” structures for private credit funds, Jason said, “the onshore fund is taking the credit risk upon origination and is then selling to its offshore parallel funds that have no obligation to purchase the loans if the deal is not good or the value changes during the seasoning period.” He also noted that using a firm’s balance sheet to season newly originated loans addresses some, but not all, of these concerns.

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